Solidcore's 'EBITDA +322%' Is Largely a Record Gold Price on a Flat Mine

Solidcore Resources, the Kazakhstan gold miner that used to be called Polymetal, reported first-half adjusted EBITDA of $641 million, up 322% from a year earlier. On its face that number reads like the business tripled. The underlying cash flows tell a more careful story, and the difference is what an investor should actually own here.

Start with the composition, because EBITDA is a margin story before it is a volume story. Solidcore's half-year revenue came to $972 million, up 199%, on gold-equivalent sales of about 205,000 ounces versus roughly 104,000 a year earlier. Two things drove that near-tripling of revenue: the gold price and a recovery in toll-processing volume. Spot gold spent the first half at record levels — crossing above $5,500 an ounce intraday in January before dipping below $4,000 by late June — and the realized price on the ounces sold works out to roughly $4,740 an ounce, about half again as high as a year earlier. That is why the dollar-per-ounce margin is so fat: with an all-in sustaining cost of about $1,298 per ounce, each ounce sold in H1 2026 cleared several thousand dollars of cash before overhead.

Now the part the headline hides. This was not a mine that suddenly produced three times as much ore. Solidcore's own mine output was essentially flat — 267 Koz in H1 versus 276 Koz a year earlier. The jump in sales volume came from its Kyzyl operation, where output rose 159% as the company recovered toll-processing of its refractory concentrate through a third-party plant and a smelter, not from new capacity. In plain terms, H1's revenue and EBITDA surge is a gold-price-and-recovery event layered on a flat production base, not a durable growth rate to extrapolate from.

Here is where the balance sheet gets interesting, and it's the part the "EBITDA +322%" headline misses. At perfect-sounding margins, net cash actually fell in the quarter — down 7% to $648 million from $699 million at the end of Q1. Cash went out even as gold was near its peak, consumed by two things: a temporary disruption in shipments of doré bars tied to changes in Russian gold-export rules, and, more importantly, the build-out of a big processing plant. That is the real story under the earnings number.

The plant is Ertis POX, Kazakhstan's first large-scale, full-cycle facility for refractory gold ore, able to process up to 300,000 tonnes of concentrate a year into up to 500,000 ounces of gold. It is the vehicle for management's target of roughly doubling gold production to about one million ounces by 2030. It is also the mechanism that addresses the company's most persistent overhang: Solidcore still sends a meaningful share of its refractory concentrate to be toll-processed at a third-party plant in Russia. Ertis brings that processing home, which removes a cross-border dependency that has kept the shares cheap for years.

That clarifies why the market refuses to pay up for an earnings number this large. The arithmetic from late April values the stock at only about 1.8x estimated 2026 EV/EBITDA — a roughly 60% discount to comparable emerging-market gold miners. A low multiple here is not automatically an opportunity, and part of the discount reflects real unresolved risk: the volatility of gold, execution on a $978 million project with about $700 million of announced bank financing, and the lingering Russia nexus. But the de-risking sequence is visible. Each step — the KfW-backed facility signed in September, the plant coming online, the toll-processing dependency shrinking — is the kind of hard evidence the market needs before it re-rates a stock this cheap.

My read is that the "EBITDA +322%" headline overstates the durability of the underlying business, and an investor who projects that growth rate forward will be disappointed when gold softens. The reason to care about Solidcore is different: a flat mine at record margins is printing cash, that cash is being spent to remove the one structural risk that has depressed the valuation, and if the build delivers, the re-rating is real even if gold does not stay at record levels. It is a bet on a de-risking catalyst with a wide margin of safety, not a bet that the 322% repeats. Someone buying today needs the confidence that Ertis comes in on time and that the discount narrows — and, as always with a name this cheap, that nothing breaks on the balance sheet while it happens.